The US Federal Reserve has raised short term interest rates for the third time this year, flagging three more rate rises in 2018 as Janet Yellen prepares to hand over the chair.
The Federal Open Market Committee increased the range by a quarter point to 1.25-.50 per cent.
Fed officials have projected three hikes in 2018 and two more in 2019, with rates settling at 2.75 percent in the longer run, according to its median estimate.
Yellen steps down on February 3, assuming her replacement Jerome Powell is confirmed by the full Senate as expected. She will preside over one last meeting at the end of next month. That will not be followed by a press conference.
In her final press conference, Ms Yellen said she was confident Mr Powell will be a good Fed chairman. “I’m confident that he is as deeply committed as I have been to the Federal Reserve’s vital public mission,” Ms Yellen said.
The Fed decision sent stocks around the globe higher but the US dollar fell.
“Today’s rate hike and the dot plot are non-events. What really matters is who is appointed to the Federal Reserve Board in 2018 and what that means for policy,” Ronald Temple, head of US equities at Lazard Asset Management told the Financial Times.